Spain awards 4GW solar and 1GW wind in auction surprise

All the capacity was awarded with the maximum discount available, proving that solar really did have a better chance in this second auction. Credit: ABB

Spain has awarded 3,909MW of solar PV capacity and 1,128MW of wind capacity to 40 companies in its latest auction, which was originally set to be only a 3GW tender.

Spain’s energy ministry noted that high demand from developers caused it to enact a clause allowing it to offer out more than the original 3GW. It said the extra awards would allow the country to “move definitively” towards meeting its 20% renewable energy targets in 2020, since all the projects must be completed by then.

All the capacity was awarded with the maximum discount available, proving that solar really did have a better chance in this second auction compared to the previous one. In the last auction, if there was a tie between wind and solar (both bid for maximum discount), the capacity would be awarded to wind.

The ministry stated: “The discounts obtained guarantee that the energy produced will be remunerated exclusively by the market – i.e without cost to consumers.”

With both major auctions combined, Spain has now awarded 8,037MW of renewable energy capacity evenly spread across wind (4,107MW) and solar (3,910MW), with 20MW going to other technologies. The solar industry had been highly vocal in its disappointment with the first auction where wind wiped the floor, so it should be pleased about the newly balanced results. It remains to be seen whether utilties and the energy establishment took away most of the capacity - a fear of Spanish PV associations that wanted new entrants and smaller companies to also take some of the capacity.

The ministry has yet to release the full list of winners.

A spokesperson for Spanish solar association, UNEF, told PV Tech: "The results of yesterday’s auction are very positive for the Spanish PV sector, as PV technology finally had the opportunity to demonstrate its high competitiveness in our country. These results will reactivate both the sector, with an estimated €3.5 billion of investments and job creation. Yesterday was a historical day for the Spanish PV sector and for many Spanish PV companies that finally will have the opportunity to grow their business in our country."

Provisional results ascertained by UNEF yesterday suggested only established companies had won at least 3.5GW of solar, including 1,550MW going to one company, Cobra, majority owned by Real Madrid president Florentino Pérez.

The spokesperson said: "This result is due to the fact that, according to the auction design defined by the government, the bid price was the main variable to be considered to select the winning projects. In case all the projects bid at the maximum discount - that is what happened - one of the criteria to select the winning projects was the size of the projects; the bigger ones were selected first."

Daniel Perez, a lawyer closely involved in Spain's solar sector, also told PV Tech that, "after five years in the desert", there was now hope again for solar in Spain, but he was also hoping for a more decentralised and distributed allocation of PV plants.

This story will be updated as more detail on the results and reaction comes in.